There’s A Boom Out There Somewhere

So turning now to the transaction market. I will tell you that remains very competitive. That remains and continues to be plenty of capital chasing very little supply. Cap rates in our core markets across the country remain in the low 4s today, as investors continue to underwrite strong revenue growth for the next several years. As we look across the marketplace today, we think values are now back to and maybe even above previous peak levels in our core markets, yet may still be down as much as 15% in others. So as we announced in our earnings release last night, during the quarter, we acquired 2 stabilized assets for $113 million at a weighted average cap rate of 4.7%. These were 118-unit deal in downtown L.A., and 247 units in Fort Lauderdale, Florida. We also acquired a 95-unit property in Daly City. It’s on the peninsula, just south of San Francisco. This asset was completed in 2011, and was totally vacant when acquired. This was the third acquisition we’ve made of a vacant property built as a for sale condominium product.

Like our other deals, we anticipate a quick lease-up and for a yield in year 2, in the mid to high 5s.